Ads.txt was created to stamp out domain spoofing, a serious threat to anyone who buys, sells digital video or ads. The move by the Trustworthy Accountability Group, which was expected, comes on the heels of Google's September announcement that it won't do business with any publishers who don't adopt the initiative.
Domain spoofing occurs when someone thinks they're buying a pre-roll video on the Financial Times when in reality, they're buying phony inventory that's literally watched by no one. Business Insider, for example, said in one instance an advertiser thought it had purchased $40,000 worth of Insider ad inventory through open exchanges when in reality, the publication only saw $97. The rest, Insider said, went to fraud.
It's also believed to have affected Google, which is regarded as having the most sophisticated anti-fraud defenses. Meanwhile, the largest ad fraud attack in advertising history also leveraged domain spoofing to bilk marketers out of millions (although, TAG disagrees).
Ads.txt thwarts domain spoofing by creating a "digital handshake" between publishers and resellers of their ad inventory. This allows marketers to see who's truly authorized to sell any given pub's ad space. According to Pixalate, more than 95,000 sites have implemented ads.txt, but only 22 percent of the top 1,000 websites have adopted the anti-fraud measure.
It's unclear how much money marketers lose to ad fraud each year because the digital ecosystem is so convoluted. Some experts peg the number at $6 billion and falling while others believe it is climbing to as much as $16 billion this year.
Publishers will have until July 1 to adopt the tool, TAG says.